Jerome Powell: Wear a mask. It'll help the economy

By CNN Business

Updated 8:53 p.m. ET, December 16, 2020
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4:14 p.m. ET, December 16, 2020

Markets finish Fed Day mixed. Nasdaq notches another record

From CNN Business' Matt Egan

US markets closed mixed Wednesday even after the Federal Reserve promised to keep in place its emergency policy stance.

  • The Dow fell 45 points, or 0.2%.
  • The S&P 500 gained 0.2%, narrowly missing a record high.
  • The Nasdaq jumped 0.5%, finishing at an all-time high.

Earlier, the Fed signaled it will keep interest rates near zero at least through 2023. The US central bank also said it will keep buying bonds at the current pace until “substantial further progress” is made in meeting its employment and inflation goals.

Meanwhile, Congressional leaders appeared to make more progress on a badly needed relief package designed to blunt the pandemic's economic impact.

3:51 p.m. ET, December 16, 2020

Jerome Powell: Folks, this ain't the 1970s

From CNN Business' David Goldman

Jerome Powell isn't sure how many more ways he can say it: Inflation just isn't a problem right now.

Sure, rates are near zero and are expected to stay there for years. But the Fed has been saying for a year that it doesn't expect inflation to pick up to its target 2% range for quite some time. That's neither a problem nor a benefit, Powell said.

Powell noted that inflation has been largely absent from the economy for three decades, and we've had the longest two expansions during that time period. Higher inflation can help businesses raise prices and boost economic activity. But low inflation means the Fed can afford to keep rates low to give businesses a break.

The Fed chair noted this isn't the 1970s, when inflation ran amok and businesses kept raising prices without stopping. Those dynamics don't exist in this economy.

"It's still there, but it's a faint heartbeat compared to what it was," Powell said.

3:24 p.m. ET, December 16, 2020

Jerome Powell: I look forward to working with my old boss again

From CNN Business' Paul R. La Monica

Has Fed Chair Jerome Powell spoken to Janet Yellen, the former chair of the Federal Reserve and Powell's old boss, since she was nominated to be President-elect Joe Biden's Treasury secretary?


"We've had and I've had the typical meetings with the transition team," Powell said at a press conference. "I really have only spoken to Yellen to congratulate her. I worked very closely with her, and I've stayed in touch. I look forward to working with her, but I won't talk policy with her until she's confirmed."

3:01 p.m. ET, December 16, 2020

Jerome Powell: This is when the economy could start to recover

From CNN Business' David Goldman

Health and safety are crucial to the success of the US economy. That's bad news for right now ... but potentially encouraging news for the spring and summer.

Case numbers are astronomically high in the United States, and that hurts businesses that rely on people congregating with one another -- bars, restaurants, etc. At a press conference, Federal Reserve Chairman Jerome Powell said he expects the first-quarter economy will "show significant effects from this."

But the first Americans have begun to get vaccinated. And although Powell admitted the Fed governors "don't have any experience with this," he believes that by the middle of 2021, as a significant number of people get vaccinated, people will begin feeling comfortable going out and spending money again.

"Some people will be probably quick to do that. Some are doing it now without a vaccine in many parts of the country," he said. "Nonetheless, my expectation and many people have the expectation that the second half of next year the economy should perform strongly. We should be getting people back to work. Businesses should be reopening and that kind of thing."

2:50 p.m. ET, December 16, 2020

Jerome Powell: We're going to see this thing through to the end

From CNN Business' David Goldman

Federal Reserve Chairman Jerome Powell wants you to know two things: 1) The economy is in deep trouble and 2) the Fed is going to do everything in its power to fix it, no matter how long that could take.

In strong language, Powell said at a press conference that the current situation could take a turn south, and the Fed is prepared to spend more money to ensure the economy's problems are solved:

We are committed to using our full range of tools to support the US economy to achieve our goals. We will continue to use our tools to support the economy for as long as it takes until the job is well and truly done. No one should doubt that.
3:57 p.m. ET, December 16, 2020

Jerome Powell: Wear a mask. It'll help the economy

From CNN Business' David Goldman

Yes, the vaccine is coming. No, it's not going to help the economy until enough people get it. And that could take many months.

In the meantime, people need to help one another stay safe, limit the spread of the virus and keep businesses open, Federal Reserve Chairman Jerome Powell said in a press conference.

"The next few months will be challenging. All of us have a role to play in the nation's response to the pandemic. Keeping social distances and wearing masks in public will help get the economy up to full strength. A full economic recovery is not likely until people know it's safe to engage in a broad range of activities."
2:18 p.m. ET, December 16, 2020

The Fed keeps rates near zero and acknowledges fragile recovery

From CNN Business' Paul R. La Monica,

The Federal Reserve, as widely expected, left interest rates near zero following its latest policy meeting Wednesday. The Fed cut rates to that level in March and has maintained that they are likely to remain there for several years as the economy recovers from the Covid-19 pandemic.

There are growing hopes that a new round of fiscal stimulus may be coming soon from politicians in Washington -- and perhaps more will be done once President-elect Joe Biden takes office next month.

Stocks' reactions were muted: The Dow was down about 100 points or 0.3%. The S&P 500 was flat and the Nasdaq was up 0.1%.

1:18 p.m. ET, December 16, 2020

Anthony Scaramucci: Buy bitcoin ... but be careful

From CNN Business' David Goldman

Anhony Scaramucci, Skybridge Capital's founder, believes your portfolio might be missing out on bitcoin. But you've got to have the stomach for it.

On CNN Business' "Markets Now" live show, Scaramucci said people have begun to accept bitcoin -- and since it appears in so few portfolios, it has plenty of room to grow.

Still, bitcoin is a volatile asset and will be a risky holding if you invest in it.

"This thing has a tendency to crash," he said. "This thing is crashing upwards and these things can be violent."

He believes stocks will continue to rise, too, despite sky-high valuations.

"There's a tremendous amount of pent-up demand," Scaramucci said, suggesting people want to get out and spend money once again.

"When that starts to happen, the numbers we're seeing from the stock market will make sense," he added, noting stock markets look ahead, rather than backward.

"I wouldn't bet against the stock market," he said.

1:36 p.m. ET, December 16, 2020

Anthony Scaramucci: Trump will leave White House without ceremony

From CNN Business' David Goldman

The West Wing of the White House in Washington, DC on December 16, 2020.
The West Wing of the White House in Washington, DC on December 16, 2020. Saul Loeb/AFP/Getty Images

Former Trump White House Communications Director Anthony Scaramucci believes President Donald Trump will leave the White House peacefully on January 20.

"I don't think it'll take a moving van to get him out of the White House," said Scaramucci, Skybridge Capital's founder, on CNN Business' "Markets Now" live show.

"He's figured out another scheme," Scaramucci said. "He's raised $300,000 and will use it for his forward operations."

Scaramucci predicted Trump will "leave without any ceremony," though the big question remains whether he will attend President-elect Joe Biden's inauguration.

"I think he will," Scaramucci said.

After Trump, Scaramucci predicts a civil war within the Republican party. He predicted a large group of legislators will break off from the GOP and form a new center-right, including Senators Joe Manchin, Susan Collins and Lisa Murkowski.

"They could become the most powerful group in the Senate," he said.

Calling Trumpism "demagoguery and nationalism," Scaramucci predicted "Trumpism will fall very quickly" after the president leaves office.